President Trump said he’s in no rush to reach a trade deal with China as he raised tariffs on $200 billion of its imports Friday, reanimating a trade war that appeared to be waning and unnerving lawmakers and retailers who say the change in tack will harm American consumers.
Raising tariffs from 10% to 25% briefly rattled markets and left trade talks between Chinese and U.S. trade negotiators hanging by a thread.
Chinese Vice Premier Liu He left the offices of U.S. Trade Representative Robert Lighthizer without a deal Friday after two days of “candid and constructive” negotiations, according to Mr. Trump.
“The relationship between President Xi [Jinping] and myself remains a very strong one, and conversations into the future will continue,” Mr. Trump tweeted. “In the meantime, the United States has imposed Tariffs on China, which may or may not be removed depending on what happens with respect to future negotiations!”
As China pledged to hit back over the tariffs, Mr. Trump seemed to downplay the necessity of a deal and promoted the tariffs as a potential revenue source for the U.S.
He said the money can be reinvested in agriculture, humanitarian assistance, health care and infrastructure.
“Tariffs will bring in FAR MORE wealth to our country than even a phenomenal deal of the traditional kind. Also, much easier & quicker to do,” he said. “Our Farmers will do better, faster, and starving nations can now be helped. Waivers on some products will be granted, or go to new source!”
He said manufacturers should make their products in the U.S., so they’ll face “NO TARIFFS!”
Mr. Trump’s comments shook the markets. The Dow Jones Industrial Average took a big dive before rebounding to positive territory after lunchtime. The S&P 500 and Nasdaq indexes saw similar movement.
Mr. Trump says the tariffs are inflicting financial pain on China, though economists say the burden largely falls on U.S. importers, who pass higher costs to American consumers.
“It’s a tax hike on Americans,” tweeted Rep. Justin Amash, Michigan Republican.
The National Retail Foundation said it’s concerned “we are shooting ourselves in the foot,” while Sen. James Lankford said the tariffs “will continue to harm American workers, American consumers, and American companies in the days ahead.
“The U.S. must find a path with China that opens up trade, not discourages it,” the Oklahoma Republican said.
Negotiators from the Trump administration and China had been working for months to strike a deal that addresses a host of issues, including complaints the Chinese steal American technology and demand trade secrets to gain leverage over the U.S.
The sides appeared to be nearing a pact in recent weeks, with Mr. Trump hinting that Mr. Xi would visit for a signing ceremony.
Yet things took a turn last weekend, when Mr. Trump suggested Beijing was reneging on prior negotiations and threatened to impose stiffer tariffs.
Chinese officials said they plan to respond in kind, though didn’t specify how.
“China deeply regrets that it will have to take necessary countermeasures,” its commerce ministry said Friday. “It is hoped that the U.S. and the Chinese side will work together and work together to resolve existing problems through cooperation and consultation.”
The president asserted the Chinese were holding out in hopes of facing off with a Democratic president who’d take a weaker line after 2020.
Capitol Hill Democrats say they want to take on China, but that Mr. Trump is taking the wrong approach.
Sen. Ron Wyden, the senior Democrat on the Senate Finance Committee, said the White House should have coordinated its strategy with economic allies.
“We came to this fight from a position of weakness as a result of isolation, instead of with an army of allies behind us supporting our confrontation of China’s trade practices,” he said.